More Power, Less Waiting: Why Storage is the Secret to AI Scalability

In many geographic markets, grid infrastructure construction timelines stretch into years. Interconnection queues are congested, power quality requirements are tightening, and AI workloads introduce sharp variability that traditional power architectures were never designed to handle. As a result, power—not land, not capital, not GPUs—has become the defining constraint on AI expansion.

Battery storage systems are emerging as one of the most effective solutions to this challenge. When equipped with fast responding controls, grid forming inverters, and sophisticated internal power distribution controls, they enable a fundamentally different approach to data center power, one that supports interconnection flexibility, accelerates time to power, protects asset performance over the long term, and advances corporate decarbonization goals.

The rapid growth of cloud computing and artificial intelligence is creating an unprecedented demand for electricity. For data center developers and operators, the most critical challenge is securing reliable power that can be brought online quickly and perform consistently under increasingly volatile load profiles.

To better understand why the average time to interconnect large loads has doubled over the past five years—from 1.5–3 years to 3–5 years, with some projects now facing delays of 6–10 years—Fluence commissioned DNV Energy Systems to interview senior executives from utilities, developers, and hyperscalers across the United States. The goal was to uncover the specific challenges facing the industry and explore opportunities to get data centers online faster while also supporting grid demand fluctuations and load variability.

To ensure these findings reflect the current operational realities of the energy transition, DNV conducted in-depth, structured interviews with 17 high-level decision-makers, including representatives from 10 electrical utilities, 5 data center developers, and 2 power project developers. These primary direct insights were then validated against market research and additional interviews with selected industry representatives to provide a grounded view of the current state of a rapidly-evolving industry.

Strategic Deep Dive: 4 Key Insights from Industry Executives

The collaboration between Fluence and DNV revealed a landscape where the primary challenge of the AI era is no longer the "bit," but the "watt." The following pillars summarize the core findings from our discussions with utility and data center leaders.

1. Flexibility That Can Accelerate Interconnection

Interconnection approval has become one of the biggest barriers to data center development. Grid operators must assess not only the magnitude of a site’s load but how that load behaves—its ramp rate, predictability, and response to disturbances.

Battery storage is a key enabling technology for accelerating the process, particularly when the grid authority has administrative and technical processes that advantage load flexibility. By enforcing ramp rate limits, smoothing load variability, and applying point of interconnection (POI) power controls, battery storage allows data centers to present a predictable, grid compliant electrical profile.

When this flexibility is formally credited by the utility, it can shorten project review times, increase the authorized size of the connection and ultimately open interconnection pathways that would otherwise be delayed.

2. Speed to Power Without Compromising Reliability 

Speed matters. In the rapidly evolving and hyper competitive AI market, accelerating energization by even a few months can directly impact market position. Battery storage is one of the fastest deployable power assets available. Factory built systems can be installed and commissioned far more quickly than new transmission infrastructure or traditional generation assets. And when integrated into a data center’s electrical architecture, storage enables sites to operate reliably even before full grid upgrades are complete.

DNV highlighted several states, including Texas, that have restructured their large-load interconnection processes to reward commitments to load flexibility through increasing the size of approved connections or assigning priority projects that include technologies such as battery storage that support flexibility.

With battery storage, accelerated timelines no longer require tradeoffs on reliability. 3. Protecting Asset Performance in High Variability Environments

Reliability is not just about keeping the lights on; it’s about protecting sensitive infrastructure from power quality disturbances that degrade performance over time. DNV’s research found that AI data centers experience large swings in power demand, ranging from 30% to 90% of their approved grid interconnection, depending the schedule of model training and other IT workloads. Within those swings, data center loads can exhibit wide variation in a single 15-minute period.

These consumption patterns can create load fluctuations and harmonic oscillations that have led to power quality issues on neighboring sections of the grid. Conversely, grid disturbances leading to poor power quality can impact sensitive data center equipment. Battery storage is uniquely positioned to mitigate both issues by injecting reactive current to stabilize low-voltage grid events, and by dynamically modulating active and reactive power to dampen AI compute load oscillations.

4. Beyond Backup: Decarbonizing Reliability and Unlocking Revenue

While speed to power is the immediate hurdle, executives are increasingly focused on the long-term sustainability and economics of their power architecture. The transition from traditional diesel backup power to battery storage represents a paradigm shift in how data centers view their energy assets.

Diesel Disruption

Traditionally, data centers have relied on diesel generators for backup. However, these assets carry high Scope 1 emissions, significant maintenance costs, and a startup lag that can delay grid synchronization. Battery storage offers an instantaneous response, providing a shock absorber for the grid that diesel simply cannot match.

Fluence Gridstack System is Proven in practice This isn't theoretical. At their facility in St. Ghislain, Belgium, Google replaced traditional diesel generators with a battery storage system. The 2.75 MW / 5.5 MWh Gridstack system integrates directly with both the site’s electrical infrastructure and the Belgian grid, providing instant response backup power while also participating in ancillary services outside of backup events. This project demonstrates that battery-based backup power isn’t just a sustainable alternative to diesel—it’s a high-performance solution built for the reliability demands of modern, mission critical infrastructure. DNV is an independent assurance provider, and the company’s contributions to this article do not translate to commentary on or an endorsement of this project.

A Levelized Cost of Energy $/MWh for battery storage vs diesel generation for backup power 

Source: DNV Report "Accelerating Data Center Speed to Power"

Unlock New Revenue Streams

Unlike a diesel generator that sits idle for a vast majority of its life, battery storage is a proactive financial tool. It actively generates revenue by providing a net benefit to the grid as a flexible asset, performing critical services like frequency regulation that enhance stability and enabling the integration of more renewable energy. This operational value helps future-proof infrastructure, lowering the potential for stranded assets by replacing carbon-intensive peaker plants and deferring costly transmission upgrades. Furthermore, this adaptability is essential for preparing for dynamic energy needs, such as the significant load increases from AI and data centers, where batteries can ensure power quality and manage consumption efficiently. To fully capitalize on this potential without compromising reliability, operators need intelligent controls to manage complex market dynamics against site-specific limits. Solutions like Fluence Mosaic™ optimize this process, automating ‘revenue stacking’ by analyzing thousands of market variables. This helps assets capture energy arbitrage opportunities by charging when prices are low and discharging when the grid needs it most.

Looking Ahead: A Roadmap for the AI-Powered Grid

The Fluence and DNV joint research initiative was born from a shared recognition that the current trajectory of data center load growth and power quality impact will ultimately conflict with broader electric system priorities of maintaining reliable, affordable, and environmentally sustainable power service to all customers. After synthesizing the perspectives of the executives at the front lines of this transition, it is clear that enabling the economic potential of AI requires energy solutions that resolve the layered challenges of data center interconnection and operations.

As a result of our collaborative deep dive, we identified three priority pillars for the industry:

• Improved Transparency Among Stakeholders: Fostering dynamic collaboration and open communication on interconnection options to help ensure developers and utilities are aligned on the best path forward.
• Design for Flexibility & Stability: Moving beyond fixed capacity planning by making load flexibility a standard feature. This includes integrating battery storage to protect sensitive equipment from poor grid power quality and to help ensure data centers can disconnect safely without causing broader grid instability.
• Repeatable Frameworks: Transitioning from "bespoke," one-off deals toward standardized regulatory and business processes that can be scaled across jurisdictions.

Federal policy and regulatory support must also keep pace with data center development to balance both load growth and consumer needs. Fluence believes this should include federal policies structured to support the rapid deployment of battery storage. Faster grid interconnection for standalone or hybrid battery energy storage systems, as well as the ability to have storage serve as both a transmission and energy asset, are critical to helping ensure consumer affordability and grid reliability.

Our Perspective: Storage is the Strategic Enabler

Throughout our conversations with utilities, regulators, and developers, one consistent theme emerged: Battery storage is a key technology for managing the AI-driven load surge. Our research confirms that the fastest-scaling data center developers and operators will not be those that simply wait for a grid connection, but those that use storage to unlock capacity, stabilize AI-induced variability, and collaborate with utilities on load-flexible designs. In this new era, battery storage has evolved from a simple backup asset into a strategic enabler of speed, resilience, and grid-aligned growth.